The highest ranking executive to leave amidst the 737 max crashes. China isreport saying planning to replace embattled chief executive carrie lam. Australian markets back online. Thats turn to sophie for what to watch and markets. Little australian stocks changed after a twoday gain. Plenty of corporate updates. A potential earnings downgrade looming. They maintained their fiscal guidance in the face of two reports from short seller J Capital Research. On itsnstruments slumped weaker than expected forecast, warning that customers are more cautious in cutting orders. It is back online after the enthronement ceremony. Stocks falling 1. 7 and wellington, led lower by power providers. Rio tinto reviewing options for its aluminum smelter i. The deficit narrowed more than forecast. A quick check on bonds this morning, aussie and he read 10year notes reversing course after a fiveday decline. Treasury futures slightly higher after cash treasuries rallied overnight on brexit uncertainty, which did see the pound falter overnight, now recovering up about. 1 heading back towards 1. 2 nine, although holding a two decline. 129, although holding a decline. Ritika there was no quid pro phonehind his conversation with the ukrainian president , he asserts. William taylor made the claim in a statement to congressional impeachment committees are the president meanwhile has tweeted that the impeachment inquiry is a lynching but added we will win. Russia and turkey have struck a deal to create a buffer zone in Northern Syria. Withdent erdogan talked president putin for more than six hours before announcing the agreement. It includes joint patrols and coordinated action with Syrian Forces. The kurdish ypg fought for years beside u. S. Forces but turkey labels then separatists and terrorists. The Financial Times says china is drafting a plan to replace carrie lam with an interim chief executive. The report cites unidentified people briefed on the celebrations invasion. Successor the interim chief executive may not stay for a full fiveyear term. Hong kong says taiwans plan to send personnel to the territory to bring back a murder suspect is completely unacceptable. The case of the hong kong citizen who allegedly murdered his girlfriend in taiwan prompted the controversial extradition bill that has led to months of hong kong protests. Taiwan once the suspect to stand trial but hong kong says it cannot extradite him because the bill has been withdrawn. Global news, 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. I am ritika gupta. This is bloomberg. Shery. Shery thank you. Downing street says delaying brexit until 2020 means calling and election. That is after mps voted against Boris Johnsons fasttrack timetable to get the Withdrawal Agreement bill passed by october 31. Annmarie hordern is in london. Theaw Parliament Supporting general principle of the deal, so why did they not want to fasttrack it . Mps felt uncomfortable with fast tracking a 115 page document that will change the course of british history. They say it was not enough time to scrutinize and really look through how the impact of this brexit deal would be on the ut economy, so while he did win a bit of a victory in the sense that he was able to get the deal through, whether or not mps agreed in principle on it, they did not agree to the fasttrack amendment. Force johnson said if they were going to vote down the fast tracking of the bill that he was going to push for a general election and actually scrap the bill in its entirety. That was not what happened. That was the biggest takeaway of tonights very dramatic events. He struck this conciliatory tone and said he would go back to the e. U. We already heard from donald tusk who said he would recommend that the e. U. Extend brexit, extend the delay. We are looking at possibly a january 31 we will get that news tomorrow. Longo or three months is a time and brexit time. What is the potential for what could happen in the next few months . Annmarie this is the big question. Does Boris Johnson use the next three months to work on getting this deal passed through parliament or does he try to push for a general election, which either way, he can come back with a majority and get the deal through exactly how he wants or he can potentially lose his power to his opposition, the labour party. The big question is what would happen in these next three months in the amendments appeared likely, what we can see is mps bringing forth amendments like keeping the u. K. In the Customs Union or wanting a second referendum. Basically a referendum on this deal to the people, and this is something that i do not think Boris Johnson would be able to swallow. In that sense, he would probably again try to scrap the bell and push for a general election, so i think the simplest answer right now is that it is all on ponce. We have another delay. I think the pound is quite significant, watching this. We are trading around this 129 area. Most strategists see it pop into the 130s. The pound has been this sentiment barometer. The likelihood that the u. K. Will crash out is not really an issue anymore. So time will tell, but it is looking like the likely that the u. K. Will not be crashing out and there will not be this chaotic brexit. Shery given how fractured u. K. Politics is at the moment, do we have any idea what a snap general election would result in . Annmarie thats a good question. Boris johnson leading in the polls so he could potentially win a majority, but you have to remember the country is still divided from the 2016 referendum outside sitting outside the house of commons. You had about equal number of remain protesters as leave protesters here at either party won a vote, you heard huge roars from them. Thousands of protesters marched on parliament, asking for a peoples vote, so the public is very much divided but it does look like Boris Johnson does have a lead in the fall. He could potentially get that majority if there was going to be a snap election. Hordern with the latest on brexit in london. Coming up, quid pro quo, new allegations that trump tired ukraine aid to rival joe bryden joe biden. To takell get naomi that on, next. This is bloomberg. Shery haidi this is daybreak asia. Shery lets head straight to hong kong for what to watching markets this morning. Sophie i want to check in on whats going on in sydney. Aussie shares are off. 1 to snap a two day advance. Wise tech under pressure, dropping nearly 7 this morning as the Company Fires back. It researches to reports alleging that the company, in its acquisition, is trying to boost its narrative to demonstrate it is a highgrowth tech firm. Wise tech confirming guidance for revenue for fiscal 2020, saying many of the claims in the J Capital Research reports are wrong. This in response to the misinformation this morning. I want to quickly turn attention to what is going on in the emerging markets given the pond for yield that continues, so jumping into the terminal, you can see em indexes are trading around the strongest levels since august, but with more political crises erupting across the em world, investors are being reminded of the risk of getting too deep into highyielding markets. Dollar yields surged to 24 in lebanon as the government grapples with demonstrations. David leavy warns that this cycles asset bubble is in the emerging market sector with Serious Problems due in the next recession. Haidi we are going to put that question to our next guest. Naomi is the em Equities Fund manager in london. She joins us in sydney today. Great to have you. This chart builds on the theme about,phie was talking this optimism. I dont know if its part of the renaissance because it was so oversold in the em space at one point. This chart, basing it on the 200 day moving average, it does appear we could have further upside when it comes to emerging market, stocks, and current. You look at a map and you can kind of tell that hitting the em grappling with unrest and turmoil. Naomi this year, emerging markets have seen and all a lot of choppiness based on the trade war fears we have been dealing with over the last 18 months. That could provide support going into next year for emerging markets. Theres hope that the dollar continues to depreciate a little bit better than emerging market currencies which would help emerging markets into next year. Earnings growth is very strong for emerging markets next year, and the risk is perhaps overstated, particularly in the more established emerging markets. India is starting to see more positive growth after a softer year and that could be a particularly positive market next year. Thei china is really bellwether. Even if we have a phase one many deal, you are dealing with so much growth. We are in a structural as well as a cyclical slowdown. Is that a bellwether . Growth. Hina has had 6 that is continuing to track down. Well within is expectations. It is not just about the headline level of growth the composition of growth and it has been well and that china is rebalancing. I would encourage people to look more selective within china for the stories they are getting exposure to, not just at the index or headline level. Services sector is particularly strong within china area the Big Education within china. These names, despite multiyear growth stories, are finding new avenues their growth. Their payments businesses, cloud businesses, as well as their core ecommerce and gaming businesses, sharing multiyear growth worries. Now at derated levels, so longterm investors can take advantage of this opportunity. Shery we have seen some stability and the chinese yuan as well or the chart on the bloomberg showing how volatility in the yuan fixing has climbed to the lowest level since 2011. This after the chinese yuan broke that level. Would this give some upside to those chinese exporters and would you consider owning some of them given that a cheaper chinese yuan could be an advantage for them . Naomi i think china has been clear going into this phase i deal that they are not going to depreciate the yuan too much further. I am not sure the u. S. Would tolerate too much further depreciation on the yuan. The domestic story is really where we are at in china. Population toge deliver on that domestic story to grow retail sales. The retail sales market in china is much larger than the u. S. That overtook the u. S. Retail sales market a couple years back. And the growing wealth of the chinese populace continues to be a very positive story. Much more stable on the longer term then trading. Shery lets talk about trading with other exporters. This chart showing the downturn we have seen on those economies dependent on trade with china. We are talking about south korea, singapore, hong kong, japan, and so forth. If will these markets fare chinese stimulus has become so targeted towards domestic consumption. I think there is some softness we can expect in those markets. China is looking to nationalize and support its own domestic economy so that does bear negatively on those other markets as you suggest. That is why we would advocate a very targeted selective approach to emerging markets, looking at where the pinch points are, looking at where the stimulus points are and the beneficiaries. It is not everybody. It is not a rising tide. China should do well. Potentially, vietnam can profit from this but it is not the same across all emerging markets. Haidi thank you so much for joining us. Here with us in sydney today. Coming up next on daybreak asia , softbank to the rescue. It is said to be taking control potential forh a a turnaround in this latest installment of the saga. This is bloomberg. Shery this is daybreak asia. I am shery ahn in new york. Haidi i am haidi stroudwatts in sydney. A Second Chance is coming for wework as part of the deal set to see softbank take control of the offer sharing company. Adam neumann severed most of his remaining ties. Lets bring in sarah mcbride. What is the latest we know in terms of these competing deals and what the likelihood is . Sarah it is all but done. Prevailbank deal will over the jp morgan bailout deal, and part of the reason is because the softbank deal included some pretty hefty payouts for the ceo, adam neumann, who is still, as of now, controlling the voting shares of the company, although that is going to change under the terms of this deal. Softbank aws lifeline. This is a company that desperately needed cash. It had 1. 5 billion on its Balance Sheet at the end of june but is now apparently already almost about to land out of cash, so the fact that this deal million in new0 loans for softbank and moving up a warrant that was not going to kick in of 1. 5 billion until next year, that should get the company some cash for now. Shery tell us a little bit about adam neumann now. Hash he, for somebody who burned through so much cash and left his Company Almost in tatters, you could say, hes doing very well. Negotiated a consultancy softbank. Llion from softbank is redoing a loan for him. 500 million against his wework shares, and through an offer, they will buy up to 980 Million Dollars worth of his shares, so hes doing very well. He will have to step down as chairman. He already steps down as ceo last month and he will be left seat at theserver company. Sarah mcbride with the latest. Thank you so much for joining us. Lets get you a quick check of the latest headlines. Facebook shares tumbled as thousand more dozens more joined the antitrust investigation into the social network. They want to determine if competition. Mark zuckerberg is to defend his cryptocurrency project before a Congressional Panel on wednesday. He said it will not launch without approval from the u. S. Government. Shery bloomberg is being told saudi aramco will push to complete its initial Public Offering this year by forces say the state owned oil producer is considering formal announcement of the listing plan as soon as next few weeks. It was originally slated for october 20 but was postponed after investors pushed back at aramco started to trillion dollars valuation. 2 trillion valuation. Haidi john donahoe. The ecommerce veteran takes charge of a 40 billion clothing giant but increasingly relies on data and technology to keep exact. He has searched on the board since 2014. He worked at nike for 40 years and will remain on as executive chairman, saying in a memo to employees, i am not going anywhere. Shery ahead of the boeing unit in charge of the 737 max jetline has stepped down. The crisis at boeing is deepening. Su keenan has more on this. This coming on the eve of those thirdquarter results. Has been have been a lot of optimism going into the results with boeing saying it is making progress in getting the regulators to return the max jet area that is now all up in the air. Lets take a look at the executive who step down. As you mentioned, three years after joining the being in the unit, just as the max jet was coming down. Kevin mcallister is the highest ranking departure in the wake of the clashes. We know the ceo, bielenberg, lost his role as the chairman earlier this month. He will Face Congress next week to testify on what boeing new. Decline ona big friday. It continued through on monday and tuesday. A bit of a bounceback, but the stock has taken a big hit and executiveat for major changes is only getting louder. One analyst said i am not sure what it accomplishes having mcallister step down. He is being replaced. There is an overwhelming view that questions will continue. Itsdowngrading boeing and latest note, saying it believes the issues are going to continue to linger, and most importantly, it believes it could affect the companies profitability, its ability to compete, and that they could be longlasting. Set to reportis earnings later on wednesday. We saw some optimism ahead of that. That boeings of you was making progress with regulators. The question is what did they know and when did they know it . That could be up in the air. In the bloomberg issue regarding there isthe analysts, the lowest target in a year in terms of where analysts believe as they downgraded the stock. It will go. Report,to the earnings the stock has been under enormous pressure. On friday, it had its biggest losses ins 2016. You are looking at the earnings watch. The expectation is for sales of over 19 billion, and earnings estimates for about 220. The big question on the Conference Call will be what is ahead and the testimony ceo. Among number testimony from the ceo, bielenberg. It will to mullenburg. This is raising uncertainty not just for boeing but the entire industry as well as boeings finances. Of course, boeing provides jets to many if not all of the major airlines. Again, this has been a huge problem. Two crashes within five months. The lion air flight, the Ethiopian Airlines flight in march of this year, and then the grounding of the giants around the world jets around the world. Testimony isthe expected to beyond what boeing knew and whether it misled those regulators. Shery thank you so much. Coming up next on daybreak asia , quid pro quo or no quid pro quo . That is the question at the center of the impeachment program for President Trump we will bring you the latest. This is bloomberg. Hey. Hey. You must be stevens phone. Now you can take control of your home wifi and get a notification the instant someone new joins your network. Only with xfinity xfi. Download the xfi app today. Ritika you are watching daybreak asia. The u. K. Officials say Prime MinisterBoris Johnson will call an election if brexit is delayed until january 31 next year. Johnsons push tois month was derailed with parliament blocking its plan to rush the deal into law. Earlier, the house of commons had backed johnsons deal. It leaves brexit in limbo with long. U. Now to decide how of a delay to offer. P. M. Johnson the house has again voted for delay rather than a timetable that would have guaranteed that the u. K. Would be in a position to leave the e. U. On october 31 with a deal, and we now face further uncertainty, and the e. U. Must now make up their minds over how to answer parliaments request for a delay. Ritika protests have continued in chile, while the president met with leaders to explore solutions to the crisis. The government says 15 people have been killed in five days of violent clashes. After country remains under an emergency decree or military curfew. The unrest is sparked by an increase in subway fares that spread into nationwide antigovernment protests. Former military chief benny gantz will be asked to try to form israels next government after Prime MinisterBenjamin Netanyahu failed to build a coalition. Foughtght Netanyahu Netanyahu to a draw. He is expected to struggle as he lacks the backing of more than half of israels parliament. India is sent to be considering curves on some imports from turkey and malaysia. Told the Modi Government is exploring tariff and nontariff measures. Turkey urged india to hold talks in pakistan over the disputed region while the malaysian Prime Minister said india has invaded and occupied kashmir. Global news, 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. I am ritika gupta. This is bloomberg. Haidi. Shery thank you. Thank you. Australian markets have been trading for a half an hour. What are you watching . Snap a stocks are set to today drop in sydney. Shares making an about turn, jumping as much as 11. 4 , after sinking 7 . It contains many claims that are wrong and maintains its guidance, saying has strategically valuable assets. Nickelent moves in the market may also be providing support after the metal rebounded in london after tumbling 15 from a fiveyear high in september. And wellington, checking in on stocks, the nzx 50 off 1. 5 with power players Meridian Energy and Contact Energy leading the drop as meridian this morning said rio tinto started a review of the aluminum smelter in museum, which includes closure as an option for i want to the diversions happening. Investors are piling in while futures traders are closing their long positions which could mean more volatility ahead for boolean. When these two markets move in tandem, they exert more pull. Gold etfs may be a better indicator of price direction. Shery thank you so much for that. President trump is under more fire in the impeachment probe after a top u. S. Envoy to ukraine testified he made military aid entirely dependent on getting help with an investigation into his rival joe biden. The lynching and said it was without due process or fairness. Ands turn to greg washington, d. C. , for the latest on this. We have the testimony of william taylor. What did we learn . Greg we saw from a really key witness here, william taylor, he is a career diplomat, the top envoy to ukraine, really someone the committee needed to hear from. Lawmakers said he ended up taking meticulous notes during many of his interactions with some of his colleagues over things he was concerned. Taylor told lawmakers he heard from a senior diplomat in Early September that trump had made that u. S. Military aid to ukraine contingent upon a public promise that there would be an investigation into his political rivals. Taylor also mentioned he had grown concerned about improper and informal channels of u. S. Policy and that he believed, his understanding of it was those channels would be led by rudy giuliani. Some very interesting testimony today. How does it play into the broader impeachment probe . A veryemember, taylor is key witness here, and while his testimony did corroborate other witnesses and fill in some gaps, the key thing is that what he said undermines the White House Defense in the impeachment probe. The white house said there was no quid pro quo in the call. They released a statement saying trump did nothing wrong and theres still no quid pro quo after this statement. They have lawmakers saying they heard from someone. A key player in ukraine, that he was told there was actually trump directed quid pro quo. Taylor was the person with the Text Messages who said it was crazy to withhold aid for political promises, and so, it is really key here. While committees will hear from other witnesses coming up, there is no doubt that todays testimony really ratcheted up the heat on the white house. Haidi Greg Sullivan there. Andish president Erdogan Vladimir Putin have agreed to insidesh a safe zone Northern Syria just hours before the end of a fiveday ceasefire brokered by the u. S. Lets bring in Jodi Schneider for more. What are the details of this agreement . Jodi they have agreed to basically have a safe zone, a buffer zone, if you will, in Northern Syria, and to have joint patrols and coordinated action to remove kurdish fighters from that area. This comes after that fiveday ceasefire that the u. S. Brokered. This all needed to happen because the u. S. Had pulled troops out of off the Syrian Border with turkey, and then that led to that turkish incursion that really threatened the kurdish fighters, the kurds who have been fighting along with u. S. Troops against isis. This is a deal. It has been proclaimed as something that should hold, that will become permanent, and that should protect the kurdish fighters. It came after a sixhour meeting between those two, the presence of those two countries to come up with for steel. Youy that ceasefire that mentioned was supposed to be temporary. Does this mean this could now become permanent . Jodi that is the expectation. Vice president mike pence said that he expects it will hold. He expects this will become a permanent situation. We will have to see, obviously. When the u. S. Pulls its troop s out of there, that really kind of made that whole area unstable. Turkey came in, the kurds were at risk. U. S. Did not really take did not accept the blame for that. That he had various things to say about the kurdish fighters but they went ahead to broker the ceasefire and it does seem to uphold in the past five days. See this agreement, we will perhaps a permanent ceasefire. Shery the president in the past really dismissed concerns about russia inserting its influence in the region. Do we know at this point how congress will react to all of these latest developments . Jodi thats a very good question. Congress has been very critical. Obviously, democratic big democratic led house with nancy pelosi and others making statements very critical of the president s moves and the president s response in this regard, but at the same time, the president faced republican aboutism about the move, his decision to pull those trips, and about how he responded after that, so now that an agreement has been brokered, presumably, there will be relief in congress, because there was a lot of concern about what happens to the kurdish fighters. Yet at the same time, one might expect that this is another situation in how the president not only acted but then responded to the criticism and how he basically did not accept the results of this. It will be something the congress will be looking at. Of course, as we just saw in that last piece, there is an impeachment probe in the u. S. House of representatives led by the democrats. They have three committees that are looking into actions by the president , so this will all certainly play into that, but one would expect this would be regarded as good news on capitol hill. Fori thank you so much that, Jodi Schneider, our Senior International editor. If you are away from a screen, you can always find indepth analysis and the big newsmakers on Bloomberg Radio. Now broadcasting live from our brandnew studio in hong kong. You can listen via the app, Bloomberg Radio plus, or bloombergradio. Com. This is bloomberg. Haidi shery this is daybreak asia. Haidi the Financial Times says china is drafting a plan to replace hong kongs carrie lam with an interim chief executive. Stephen engle has been following this target from the very beginning. This latest twist, how much merit do we give to this . Stephen this has kind of been in the works for quite some time according to sources i have talked to. She was even caught on audio saying she offered to resign sometime back in beijing refused that overture from carrie lam, so this is obviously what protesters from the very beginning have wanted. Wanted, beijing has not to necessarily, you know, give credence to the protesters demand or make it look like she is stepping down because of the increased violence here. Now, the Financial Times is reporting that beijing is drafting a plan to replace carrie lam with an interim chief executive to possibly be installed by march. Which of course is the date of the National Peoples congress. Again, beijing wants to make sure that the situation here in hong kong is not as volatile so as not to give the impression that they are acquiescing to the protesters demands. What we are hearing from the Financial Times to report is the replacement should not necessarily stay on for a fiveyear term after completing carrie lams existing term, which ends in 2022. Who will replace her . This man is one person the ft sites as a possibility. Norman chan is a former head of the Hong Kong Monetary authority , that a factor centralbank chief here. He served in that role from 2009 until his timely, what, retirement just in september of this year, so just last month. Another person who has been bandied about, henry tang. A former financial secretary as well as a former chief secretary. He is not without controversy himself. His desire is to be chief executive and it was waylaid by a scandal involving a large wine cellar in an illegal basement. That was not norman chan that we showed the picture of, but in the meantime, what are we going to expect in terms of stimulus measures coming from the hong kong government, given that the economy is now headed towards a recession . Chanen another chan, paul , is the financial secretary and he has unveiled a new stimulus package. It is not a big bang. It is intended to help some of the businesses and industries that have been hardest hit like terrorism and transportation, so there are some subsidies for taxi drivers and other areas of transport and also some subsidies for travel agents. 255 million u. S. Dollars. About 2 billion hong kong dollars targeting terrorism and transport industries. Basically those who have suffered through these protests. Again, not the big bang. Since the Economic Situation it is worsening quite fast. We rolled out this package targeting certain sectors, which are continueward, we will to monitor this situation closely. Are areas that require further assistance, we will not hesitate drawing out additional measures to help. Stephen paul chan also has been. Amed as a possible successor to carrie lam, they have called normane three chan, chan, paul chan, and bernard chan. All unrelated. He is the convene or of the expo. Closere perhaps far too to the current administration. Steve engle and hong kong, thank you so much for that. Lets get you a quick check of the latest business flash headlines. Softbank is said to be taking control of we work in a rescue plan that will see the cofounder, adam neumann, cut most of his remaining ties with the company. The Parent Company is running out of cash after septembers failed Public Offering. He will give up his board seat and walk away with as much as 1. 2 billion as well as half 1 billion credit line from softbank. Shery ubs was given a muchneeded boost from rich asian clients and what was otherwise a tough quarter. Wealth west met Management Unit added 16 billion. Profit beat estimates. This or spain says it will book 100 million charge in the Fourth Quarter to restructure its securities unit. Ofdi hard on the heels projects on the rise, new zealand says it will fly nonstop from auckland to new york for next october. The qb carrier says it will use dreamliner. Last weekend, australias qantas flew a direct line from new york to city on a Research Flight in a journey of more than 19 hours. Coming up next, how is positioning itself as the u. S. And china trade war takes its toll on Global Agriculture . We will be hearing from the ceo. This is bloomberg. You are watching daybreak asia. Chinese buyers are back in the market for u. S. Soybeans after President Trump said trade talks are dancing. Sources say processors and china got permission to buy another 10 Million Metric Tons exempt from retaliatory duties. Isochemical giant bringing in more revenue as it prepares for what could become the industrys biggest ever ipo. I caught up with the ceo to discuss the market in china and the trade war. It is a hugely important market. If you look at the Chinese Agriculture market, the Technology Players are all small. Seed, cropchinese Protection Companies have been there for years, but we all have small single digit market share. So china needs a leader. We are putting full effort into baseoth building our business, investing more in people, strengthening our capabilities on the ground, but we are also doing m a work, so we expect the combination of those two to enable us to build a clear leadership position in seeds and crop protection. You are a Chinese State owned company that is heavily dependent on u. S. Farmers. So how is the u. S. China trade war affecting your business, and what changes are you seeing emerging . The u. S. Is our largest market in the world, hugely challenged mainly because of the weather. There was horrendous, horrendous flood in the united states, but also the trade war. So next year, we are hoping for Better Weather but we are also really hoping that a trade deal can happen at least in agriculture because it is really important both for china, who needs the agriculture products that the u. S. Farmer makes, produces, but also important for the u. S. Farmer that needs the Chinese Agriculture markets, so we are trying to encourage that a deal gets done. We would love to see that happen. It would be great for the u. S. Farmer. They are the most productive in the world. That is why we have so much capability to serve the u. S. Farmer and the Chinese Market is the biggest market in the world. It would be great to have those two lined up again. Theres a lot that has to happen between now and then. How much concern you may even hear it from the chinese side. Progress is being made on trade tensions. You are a company that could be caught in the middle of that. We feel that things are getting better. We are hoping that something the same time, we have got a Large Business all over the world. We are in every Single Market around the world. We will keep serving farmers everywhere, including here in the united states. The more options they have for exporting their products. You talk about m as when it comes to boosting your business in china. Is there anything in particular that you are looking at right now . There are a number of things we are looking at now. Strengthening our base business, growing organically, strong double digits, but also, acquisitions i expect to announced sometime next year. Eric there. Was this year has not really been one for massive deals like china in 2016. Chemical in fact, quite the contrary. Many chinese firms are looking to upload overseas businesses. The volatile market is complicating those efforts could selina wang has the story. Those companies were forced to kind of showed these overseas assets. The market is not exactly a good one for sellers at the moment. Thats right here the context is as you mentioned, a couple years ago, the Chinese Government was trying to curb Financial Risks so they were stepping up to scrutiny of these foreign deals as well as trying to curb these capital outflows. We have seen companies for a few years try to offload some of these assets but we are seeing a lot of market volatility is not a great time to be offloading these assets when you are dealing with the u. S. China trade war. Brexit uncertainties as well as the ongoing hong kong protest. Just a few examples of this, it includes the Italian Yacht maker owned by they shelved their ipo last week. You also have this u. K. Pizza chain, pizza express, owned by a Chinese Private equity group. According to our sources, they hired a Financial Advisor to Start Talking with their creditors about their debt, so they have been struggling a lot in their domestic market as well as their efforts to expand into china. You have this situation where a lot of these chinese firms have acquired these companies at the top of the cycle, overpaying for assets that did not make a lot of strategic sense to them, and now, they are finding it very difficult to offload these businesses. Shery what do the numbers look like when it comes to the deals completed this year . The volume of chinese outbound deals according to the crunched at bloomberg west 59 billion, a 13 drop from the year before, but it is a far cry from the peak of these massive deals in 2016. That is when you saw the deal with the National China chemical corporation. Billion, so in3 addition to the u. S. China trade tensions, they are expected to continue to weigh on the value of the outbound deals. Also have countries around the world really increasing their scrutiny of chinese deals, especially from the u. S. And from europe when it comes to areas of technology and infrastructure in the trump administration. We have seen a whole string of deals from china get blocked, including complications around broadcom and qualcomm and financial and money gram. We also saw it earlier this year they chinese firm really exit their plan to acquire the utility for impaired a lot of complications. When you take the challenges that these Chinese Companies are facing in terms of domestic capital controls and efforts to curb capital outflows, add that on with the geopolitical risks, plus the greater scrutiny of Chinese Companies, you are seeing a really big drop in chinese outbound mna. Shery selina wang, thank you so much, our chinese correspondent from beijing. Japan coming back from a holiday. Lets turn to sophie for what to watch and markets. Sophie nikkei futures are pointing higher but we could see a mixed start for the region with aussie stocks under pressure, set to snap a twoday gain. These are among the names to report today. Lng displays estimates from analysts, losses for 2019, close to 1 billion in light of weak demand for the u. S. And china. A fresh alarm with a fourthquarter revenue forecast that trailed the lowest estimates on wall street. The Company Warning that trade tensions are making customers far more cautious. With asian cash trade for treasuries resuming as japan reopens, Futures Holding an overnight advance after you cape Prime MinisterBoris Johnson to fasttrack his brexit deal into law. That is what is coming up next on daybreak asia, with the open in japan and south korea upon us. This is bloomberg. This is bloomberg. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Have just opened trade. Welcome to bloomberg daybreak asia. Our top stories this wednesday, the brexit turmoil continues. Boris johnson calling and election as parliament refuses to let him rush his divorce deal into law. s softbank deal may save the company, but the founder is angering some. In hong kong, a report saying china is planning to replace embattled executive carrie lam. Lets get to the market action. Tokyo is back from holiday. Japanese markets reopening with green shoots for the nikkei and topix. We are keeping an eye on softbank today as it takes control of wework and japanese banks in view, the boj will require stress test for seven big lenders, which mirrors a slump in equity markets and a jump in the yen, which is keeping steady at around 108. 46. We may see some depth in jgbs after declines. Lets check in on the mood in off 1 10ea, the kospi of 1 . We have some earnings to look out for, including samsung biologics. A grim outlook for Texas Instruments. Ae korean won set to snap fourday game today. Aussie qe stocks under pressure today and kiwi stocks under pressure today. Meridian energy dropping the most in wellington, as rio tinto reviews its operations in new zealand. The author dollar aussie dollar challenging the midseptember high. Lets get your first word news. Thank you. The top u. S. Envoy to ukraine has directly contradicted President Trumps assertions there was no quid pro quo behind his july 25 phone conversation with the ukrainian president. The acting ambassador made a claim in a statement to encrypt congressional impeachment committees. The president tweeted that the impeachment requirement is a lynching. Russia and turkey have struck a deal to create a buffer zone in Northern Syria. Than sixed for more hours before announcing the agreement. It includes joint patrols and coordinated action with Syrian Forces to remove kurdish fighters from border areas. The kurdish ypg fought for years next to u. S. Forces but turkey labeled them separatists and terrorists. The Financial Times says china is dropping plan to replace carrie lam with an interim chief executive for hong kong. People briefed on the deliberations said the successor would be installed by march if the chinese president decides to carry out the plan. The interim chief executive might not stay for a full fiveyear term. Plan to bring back a murder suspect is unacceptable to hong kong. A hong kong citizen reportedly murdered his girlfriend in taiwan. Hong kong says it cannot extradite him because the bill has been withdrawn. Global news 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Thank you. Downing street says delaying brexit until 20 means calling and election. Mps voted against or johnsons fasttrack timetable to get the agreement passed by october 31, and the European Council president said he would recommend that the eu accept the u. K. Request for a brexit extension. We are in london with the latest. Where does this leave us . Answerbrexit, the simple is we are on pause at the moment. Tonight was dramatic, Boris Johnson able to get the deal through parliament and mps voted that they liked the bill in terms of the principal, but when it came to fast tracking the legislation, that is where johnson suffered a defeat. The promise to take the u. K. Out by octobero or die 31 is virtually impossible. We have to wait and see what the eu says. They say they will recommend the extension. Thebig question is when u. K. Gets the extension, can johnson use the extension to get the deal through parliament and into legislation or does he push for a general election . He did say quite tellingly when he was able to speak after the volk that this deal after the vote that this deal would be after they left the eu. What does this mean when u. K. Politics is so fractured . So fractured, that is 100 right, from the 2016 referendum, and the country is still divided in terms of leave and remain. But johnson has pretty much done what he said he would do. Even tonight he was talking about the fact that he has put in place operation yellow hammer, putting agencies on guard for a possible no deal exit, even with the extension. Ands leading in the polls has a very good chance, and if you would win, he could come back in with the majority and get the deal he wants and parliament. But there is no certainty that what happen and there was a risk he could lose power to labour and the opposition party. I would look at where the pound is trading, it has been trading today, andrange even most fx strategists say the risk of a no deal brexit puts us into 135. If we were to have a general election, Boris Johnson does have a good chance, even where he is now in the polls. Thank you so much. The latest on brexit. With us now from singapore is a jp morgan cio. Great to have you with us. Here is what pimco had to say about the implication of what happened today on the brexit vote. Take a listen. I think the uncertainty continues but it looks increasingly unlikely that we get some form of no deal hard brexit. I think an extension would be seen as a positive sign, he gives more time to negotiate it gives more time to negotiate exit. Would you agree that a no deal, hard brexit is off the table . Hopeful, but like many other things that have occurred in the last week, i am skeptical about the outcome. While it is true that there is some agreement and parliament to work toward a deal, its not surprising it has been delayed. It would be difficult to rush through a complex deal and a couple of weeks so the delay was expected. What we cant be sure is with the delay, wasnt meant to work toward an agreement or will we find out the some members of parliament are going to use the delay to lineup opposition to the agreement . Thats what we have to wait and see. Itthats the concern, when comes to between now and potentially the end of january, thats how long the extension is four. That is a long time in brexit time. What happens if there is a general election . The door is wide open for volatility. Thrown wide open for volatility. I think right now the markets are fairly complacent about it and they think with Boris Johnson ahead in the polls, he will likely win a general election and be able to go through and drive his original plan through. That is the complacency in the market. We look at where pound sterling is and we are at about 129 right now. A lot of good news is priced in. For us, the upside on palatable agreements getting through in the next month or so takes you to 135, but if there is no agreement and there is a hard brexit, you see the downside all the way down to 115. About onore to talk brexit. We will talk about the fed reaction to the current Global Economy. Plus, the anger inside wework after they agreed to softbanks bailout, with the cofounder potentially walking away with a billiondollar payout. This is bloomberg. Welcome back to bloomberg daybreak asia, we are watching reaction to biogen watching for a approved therapy. It could be the drug industrys most dramatic reversal forcing reversal of fortune in history. Rise, offerset to 131 to 1. This has also boosted samsung biologics. It jumped as much as 10. 6 earlier. Thank you. The imf has made a fifth straight cut to its growth forecast. Its projecting the weakest expansion since 2009. Ele. Ing us is bob mich there are two schools of thoughts, one is that we are pessimistic that brexit will get done and growth will continue, albeit in a more moderate way into 2020. The other thought is that things will worsen. Im wondering where you set. Take a look at this chart, the imf cuts to Global Growth to 3 viewed weve had so may cuts in the last few months alone. Does this suggest that there is a fear that even if the trade deal gets done in phase i or phase ii, it will take a long time to unwind the damage to sentiment that has been done . Bob i think thats exactly the tone of the ims meeting with the market is expecting. The phase one deal, while palatable is relatively benign. It doesnt rollback any tariffs currently in place, and other things Like Technology and intellectual property rights, there havent been any hard agreements on those, and we are expected to wait until phase ii or phase three for some determination. As i said earlier, thats why the skepticism exists. We do know the Global Economy is slowing down right now. Its not just manufacturing. If you look at the u. S. , retail sales have declined as well. Corporate confidence is very low. What is cushioning the downside is the Central Banks are not waiting for the very bad news to hit, they have already begun to respond by cutting rates, and when we get into a couple of weeks from now, the ecb will start expanding its Balance Sheet again. We are somewhat pessimistic on the Growth Outlook but we are glad that the Central Banks have begun to respond already. Does that mean of the backup and yields we have seen as this chart shows, will not really be sustained given the potential uncertainty on easing could get in the way . [laughs] there is no way yields can be sustained at these high levels unless there is a true compromise on the trade front or we see some meaningful fiscal stimulus. We have the fed cutting rates, we have rate cuts across the emerging markets. You have the ecb about to go to perpetual 20 billion euros per month of Balance Sheet expansion. There is a global search for yield, and with so many of the bond markets in negative yield, these are going right back down. Where do you find value in yield in the next few months if we are seeing the old playbook continues . For well, you look highquality duration. It can happen in Government Bond markets. We talked about the 10 year treasury being right about 180 today, but there are other markets like canada and australia where you can still go in and get positive yields. It is interesting to us, some of the debate going on about the fed, should they keep dry powder or not. Their concern should be looking at inflation expectations, they are well below the 2 target. Toy have plenty of capacity ease without creating any kind of inflation surge. I think Government Bond yields are a good place to start, Investment GradeCorporate Bonds are another place to look, and securitized markets. Highquality duration will be in demand. Shery what does it mean if we get more fiscal stimulus in the mix as well . Bob that could change the course of monetary policy. In a way, the Central Banks are inviting fiscal stimulus. They brought real funding rates down to negative certainly across europe, and now in the u. S. , and certainly in parts of emerging markets. They are inviting governments to borrow and spend, but it is difficult to find anyone who has the capacity to actually get physical thrust through the government. You have a split congress in the u. S. , that is not likely to happen. When you look at europe, you are coming out of years of austerity where they have been trying to bring debt to gdp down, so youre not likely to get a large fiscal impulse out of europe. You might get relaxation of the fiscal targets set in place, but not a lot. The only place you really see capacity and are seeing some fiscal stimulus is china. But how much are they willing to do at this point in the cycle . The results as earnings season have been pretty upbeat, is that an indication that companies, particularly ones banking on consumer strength continuing, that they are operating in a new normal of geopolitical tensions and the gradual slow down, or is there a sense expectations have been lowered and the companies are just meeting that . Bob i think it is a combination of things. I think the recovery from the great financial crisis never got to the heights everyone hoped they would get to. Companies spent the last decade trying to control their cost base. Theyve never been overly optimistic, and i think you are seeing that play through in earnings. That is likely to continue. Shery what about the u. S. Dollar . If you see strength in the u. S. Dollar, what does that mean for the earnings season in the u. S. . And where you see the greenback going . Bob the dollar looks pretty stable to us right now. Upsidereceived a lot of momentum with concerns over brexit and the tariffs, and now that that has cooled off in the last week or so, you are seeing some other currencies recover against that. As we roll forward into next year, even though we expect the u. S. To continue to slow down, its a economy still looks stronger than many other economies out there and rates are still relatively high. That will attract dollars into the market. We think the dollar will be stable with some upside. Shery bob, thank you so much. Jp morgan Asset Management cio. If you need a roundup of stories to get your day going, bloomberg subscribers go to your terminal, also on mobile. This is bloomberg. Is bloomberg daybreak asia. Haidi you have got to be kidding me that was one of weworksions posted on staff Communication System after a cofounder was to get over a billion dollars in a payout from softbanks buyout plan. Tell us about the reaction inside wework. Is part of a rescue passage rescue package softbank has arranged for wework, they are buying shares and about one third of it will go to adam neumann. In addition, hes getting about 185 thousand dollars in consulting fees, i 500 Million Financing line from softbank and he still gets to be involved with the board. It is reasonable to blame him for the dire straits the Company Finds itself in, but it is also a direct result of growth at all costs business strategy, that all of the shareholders, including softbank, encouraged until now. He does bear some personal responsibility for the more egregious excesses that have led public investors to bulk at ipo, but fore employees left behind, it is galling because they recently received emails from the ceo saying they were going to be humane but its not clear that any of the people are getting a severance package. Good old insult and injury package for the people there. Haidi do we have more details on the financing plan . Is preparingnk about a 9. 5 billion dollar including a Share Buyback from existing shareholders. Softbank only makes the company, but the more salient number is the newest infusion will value wework at about a billion dollars. About 8at is billion. Shery that is much less than the last investment round in january. What will this mean for softbank . The valuation is tricky, but even if the company was valued 20 and 30, this is a considerable haircut and comes at a terrible time. They are about to report earnings and they will book losses on valuations from uber and slack, and some Portfolio Companies that went public. Bes not sure if wework will on this quarter or the following for the next couple of quarters, the story is not great. In sprintn to losses and the deal that has not been closed. Becauseng is terrible at the same time he is trying to convince new investors for his second vision fund. The timing and optics are not great. Much, ournk you so tech reporter from tokyo. Lets get a quick check of the business flash headlines. Boeing says Kevin Mcallister is stepping down from the head of his its jetline division. Mcallister is the highestranking executive in the wake of the deadly max jet crashes and the worldwide grounding that began in march. The head of the Global Services district will replace him. Haidi bloomberg has been told saudi aramco will push for its ipo this year by relying more on local investors. Sources say the oil producer is considering a formal announcement as soon as the next few weeks. It was postponed after overseas investors pushed back on aramcos touted to trillion dollar valuation. Hand hiskes ceo will job to the former head of ebay next january. He takes charge of a 40 billion clothing giant increasingly relying on technology to keep its edge. Nike for 40orked at years and will remain executive chairman, saying in a memo to employees, i am not going anywhere. Shery coming up next, reports of beijing eyeing potential replacement for hong kongs lam. Secular carrie we will go through the possible candidates, next. And we are waiting for the opening of the hang seng index and we could see upside as we continue to see the reports that china is eyeing replacing the embattled chief executive. Lindsey moore to come. This is bloomberg. Plenty more to come. This is bloomberg. This is daybreak asia. A u. K. Official says Prime MinisterBoris Johnson will call an election if brexit is delayed until january 30 first of next year. Johnsons push to take the u. K. Out of the European Union this month was derailed with parliament blocking his plan to rush the deal into law. Earlier, the house of commons had backed his deal but brexit is now in limbo with the eu having to decide how long of a delay to offer. Disappointment that the house has voted for delay rather than a timetable that would guarantee the u. K. Would be in a position to leave the eu on october 31 with a deal. We now face further uncertainty and the eu must now make up their minds on how to answer parliaments request for a delay. Street protests have continued in chile while the president met with political leaders to come up with solutions for the crisis. 15 people have been killed in five days of rioting and violent clashes. About half of the country is under an emergency decree and curfew. This was sparked by increasing subway fares. A former military chief will be asked to form israels next government after the Prime Minister failed to build a ruling coalition. Now be given the mandate to form a parliamentary majority but he is expected to struggle as he lacks the backing of more than half of israels parliament. Be consideringo curbs on some imports from turkey and malaysia in response to their leaders comments on the aton ami of autonomy of ashmire. K havey has been asked to talks with india over the region. The indian Prime Minister says turkey has occupied and invaded kashmire. Global news 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Haidi thank you. Lets get a market check with sophie in hong kong. Sophie stocks under pressure across the region. Bonds are on the advance. The nikkei 225 with little change. Drugmaker one on a hopes that is alzheimers therapy will be approved. Weiss tech is jumping after responding to a short sell. With the biggest drop in the region. Kiwi Dollar Holding Steady after the trade deficit narrowed more than forecast and the and this morning building on tuesdays advance amid lingering brexit uncertainty thats all the pound lose ground against peers overnight. Holding the declines in the asian session. Is forecast to depreciate by 4. 9 by the end of 2019 given its vulnerability to trade. Thats get a check on s p futures, slipping below a two day intraday low, which could see the benchmark continuing to slide low 3000 points. Futures are fluctuating and getting about seven tense of 1 after losing ground on brexit developments. Haidi thank you. The Financial Times says china is dropping a plan to replace hong kongs carrie lam with interim an interim chief executive. Stephen engle has been following this from the beginning. How much merit does this report warrant . Interesting to look at this and see if it has been building momentum. He heard from carrie lam a little while ago in a secret audio recording saying she had resign resign but it wasnt accepted by beijing. Beijing is at least likely considering it and coming up with options. The Financial Times says beijing is drafting a plan to place carrie lam with what they call an interim chief executive, to be possibly installed by march. Thats when china holds its annual session of parliament. Said the replacement would not necessarily stay on for a full fiveyear term after completing lams existing term, which completes in 2022. Beijing reportedly wants the hong kong situation to stabilize first before making such a decision. They dont want to be seem to be given into the violence. Who would potentially replace carrie lam . Financial times is naming to people atop a short list, including the former hkma chief executive, who retired just last month after about a decade as the head of hong kong safeco central bank. Facto centrals de bank. Also henry tang, who lost a bid to be the central executive after he had built an illegal basement that housed much of his large wine collection. Kong meantime, the hong economy headed for a technical recession. Why do we know about stimulus measures announced by the government . Stephen it is not a big bang, it is the second package that the financial secretary has unveiled. This one to help businesses in particular that have been hurt by protests, namely in the tourism industry, travel andstries travel agents transportation. Economic situation is worsening quite fast, we have this package targeting certain sectors. Going forward, we will continue to monitor the situation closely , and if there are areas that require further assistance, we will not hesitate rolling out additional measures. About 2 this package is billion hong kong dollars, 255 million u. S. Dollars. One other quick story, we will get updates today perhaps on the ongoing saga of the murder suspect that triggered the expedition fiasco in hong kong. He is expected to be released today from hong kong prison where he has been serving his jail sentence for money laundering. There is a lot of confusion on whether taiwan will send over representatives to retrieve him and taken back to taiwan to stand trial, possibly on charges of murder. However, there is a big clinical spat going on between hong kong and taiwan right now and hong kong is claiming that taiwan is trying to politicize this event. It is yet to be determined whether that, whether he will be repatriated to taiwan today. Haidi we will be waiting for that. Stephen engle, thank you, joining us from hong kong with the latest on the ground. Michele. Ng back bob we have seen hong kong assets underperforming with the hang seng index barely in the green this year after counterparts have rallied 20 this year already. Can there be a sustained upside in the city assets when the protests continue . Bob i think it is important to remember that governments responding to populist unrest is not only isolated to hong kong but in other parts of the world. , forre seeing it in chile example. What has been interesting to us is how well the markets have held up in the face of this populist unrest. We attribute it to a couple of things. First thing we look at is the Central Banks have responded in earnest. If you look across asia first, the bank of korea cut rates last week and we expect the bank of indonesia to cut rates this week. You are going to see other emergingmarket Central Banks cut rates russia, turkey, chile for example. What is also interesting was coming out of the imf meetings is the view that there was a structural shift in investing in emerging markets. It may be the hunt for yield. If we look for local emerging bond markets and aggregate yield , it is about 5. 1 . That is an alltime low. That is telling us that there is a hunt for yield and there is confidence and how the Central Banks are responding. There is so much cash around that markets are starting to look through some of the populist unrest. Shery and we have seen not only the central bank acting in china but fiscal measures in place as well. How does that affect the Market Outlook when you have a different policy mix . Gaugee are all trying to how much a physical impulse we will see out of china. They have already borrowed and spent quite a bit. They have done a lot to stabilize the Banking System and inject liquidity into the regional banks. There has been some fiscal spend. Do they continue on that trend or pause here and see how phase one and maybe phase two and three trade agreements work out before they go back to additional fiscal spend . One it take Something Like a surge in unemployment to get them to respond more aggressively . Those are the kind of things we are looking for. Do you think the rate differential with chinese bonds becomes more constructive over time . Bob without question. We are already seeing tremendous amounts of interest. The inclusion of the chinese bond market into the popular global bond indices created the initial round of buying. We step back and look at 3 for fiveyear chinese local debt, that is relatively high. It is well above yields in the u. S. , and most of the developed market, and it is starting to attract some investment. Haidi what about the impact of local currencies . You kind of put that out there as being one reason why you do have to be cautious. When it comes to the yuan, do you expect this sort of moderation we have seen to be maintained . Bob we think so. And again, it is a lot of game theory. It is chinas position in the trade negotiations. It just doesnt seem to be in their best interest to allow the yuan to depreciate very rapidly and then trigger a more aggressive response out of washington. We think there will be some stability there. Shery thank you so much for joining us throughout our show. Jp morgan Asset Management cio bob michele. We have an alert on the bloomberg concerning the protests in chile. The president of chile is having a televised speech and he is saying public order is improving but that he wont be lifting the state of emergency just yet. We know about half of the country remains under an emergency decree or military curfew. Chile will lift basic pensions for0 , and pump up pensions 500,000 workers, and the government is planning insurance to Cover Health Care costs. Aile is also announcing guaranteed minimum income of 350,000 pesos. This the latest on the massive protests that continue in chile. This is bloomberg. Shery this is bloomberg daybreak asia. Haidi shares are set to rise after a japanese maker said they would ask u. S. Regulators to improve an experimental treatment for alzheimers. Thats get the latest from our health care editor. This has been a drug abandoned for a couple of years, so why now are we seeing impetus to go to the fda . This has been one of the most unusual reversals in the history of medicine, really. Said the drug was not working and was not showing results in trials, and they halted the trial at the time and billions were lost. Now they have come back and said the data that came in after the halt, as they looked at the data again, they feel it was working. A have gone to the fda and are going to submit for approval. It will be one of the first showsfor alzheimers that this sort of improvement and it is a big deal in the history of this disease. Sawingit is really web themedical whipsawing medical world. The trial was suspended about six months ago. What can we expect in terms of upside now that it is back on . Shares we can expects to surge expect shares to surge. Biogen regained all of the lost market value and more. If the drug is approved and goes to market, it is a huge milestone in history of alzheimers, for which there is no cure. We can expect these two pharmaceutical companies to keep surging. Haidi what is the timeline we are looking at . Aa approval for any drug is multiprocess. Rachel from what we understand, the drug is close to the finish line. The Companies Already talk to the fda when they really looked at data and they were encouraged by the fda to come back to the table. We know that the fda will go to a panel of outside experts and listen to their recommendation but the drug is quite close to coming onto the market. It is not years away, it is months away. Shery thank you so much for that. Turn to boeing, the head of the boeing unit in charge of the troubled 737 max 8 jetline has stepped down after less than three years in the job, the latest sign that the crisis and boeing is deepening and likely to over shower overshadow wednesday earnings. Despite the reshuffle in management, we have seen boeing rallying. What can we expect . Call it a relief rally and some might say that what was expected to be upbeat events and comments, but check out what we have in this latest development, the board deciding that Kevin Mcallister, the former commercial airlines a ceo, should step down. He will be replaced by an executive that will move into the position. For major executive changes is only getting louder. Look at how the stock has performed, down dramatically on friday, follow through on monday. While there was a bit of a rebound, you do again have the earnings coming out that are likely to be eclipsed by these developments. What you have of course is a lot of internal memos that have come out that are raising questions about what boeing new and when they knew there were problems with the max jet. And there is the suggestion that the memos support that the regulators were misled about the max jet, that resulted in two crashes five months apart. That is putting the company under fire. While there had been a lot of upbeat wording from boeing about returning the max jet to service, this clearly sets everything back. Upbeat but obviously a lot more pressure on boeing set to come again on wednesday, they are reporting earnings. Su if you go onto the bloomberg, you see not only has sales gone down, but the earnings projections by analysts. Chart, targetis lowered to the lowest and year for earnings. Clearly the earnings expectations are relatively positive, but the pressure on the stock is likely to continue, some say, because the numbers are not going to be the focus. The earnings numbers, and if we go to the wall, we have a presentation for you, the earnings are likely to be secondary to questions on a Conference Call about the major issues that are facing this company. Mainly the fact that the max jet, which was expected to go back into service by early 2020, for many of the Different Airlines and every airline had a different issue with boeing i think we have another panel. They are you see the concerns for all of these Different Airlines. How many jets were grounded and when they might bring them back to service is a key question. Willeo, dennis muilenburg, be testifying before the house and Senate Committees on tuesday and wednesday of next week. He will have a lot of explaining to do, that is what insiders are saying. Again, they want to know what these internal memos say about what the company perhaps said to regulators. That will be the overriding issue as earnings come out and as the company goes forward. Much, suank you so keenan in new york. If you are away from the screen, you can get indepth analysis on Bloomberg Radio. We are broadcasting live from our new studio in hong kong. App, Bloomberg Radio plus, or bloomberg. Com. This is bloomberg. This is bloomberg daybreak asia. Shery lets get a check on the business flash headlines. Planning to raise about 850 million by the First Quarter of next year and use the money to fund an ipo. The company also says it is in talks to form a joint venture in china to scale production. Earlier this month, the Company Founder filed for bankruptcy in the u. S. After running up billions of dollars in personal debt trying to build the Business Empire in china. Haidi bloomberg has been told saudi aramco will push to complete its ipo this year by relying more on local investors. Sources say the oil producer is considering a formal announcement as soon as the next few weeks. It was originally slated for october 20 that was postponed after overseas investors pushed back on aramcos touted to trillion dollar valuation. Shery facebook shares tumbled morejoined the states joined the antitrust investigation. They are trying to determine if facebook has stifled competition. Meanwhile, Mark Zuckerberg is defending his cryptocurrency project before congress. He says he wont launch without approval from the u. S. Government. Haidi ubs was given a boost from asian clients on what was otherwise a tough quarter. Its wealth Management Unit added over 16 billion in september. Bookwiss bank says it will a 100 million charge in the Fourth Quarter to restructure its securities unit. Lets get a look at what to watch in markets. Chipe we are watching shares after Texas Instruments fourthquarter revenue forecast trailed the lowest estimate on wall street. Names radar with various already succumbing to losses early in the asia assessing asia section. Session. Also Chinese Pharmaceuticals after reports of a vicious plan to bring down drug prices. To release plans significant drugs every few months. We are watching seed and Plant Companies after a company saying they are trying to boost contribution from the mainland. This as the new yorkbased Company Lance for an ipo. Plans for an ipo. Haidi lets take a look at how markets are trading going into the Mainland China and hong kong open. The nikkei 225 playing catchup, japanese shares up 1 10 of 1 after yesterdays imperial enthronement public holiday. The kospi up. In australia, we are seeing declines of about 3 10 of 1 and new zealand with serious downside. We are looking ahead to the open in hong kong and seeing how stocks they are potentially are playing catchup as it is reported carrie lam will be replaced sometime soon. Shery later on bloomberg tv, the imf deputy rector of the asiapacific will be on Bloomberg Markets after the release of the latest asiapacific outlook, that is at 11 10 a. M. In hong kong. That is it from daybreak continuesket coverage. China open is next. This is bloomberg. Bloomberg to markets china open. A new turn in the protests in hong kong. Tom brexit turmoil continues. Allow borisoes not johnson to russias divorce deal into law. Isthe we work rescue plan facing controversy